Lucking v. Detroit & Cleveland Nav. Co.

KNAPPEN, Circuit Judge (after stating the facts as above). In our opinion the court below rightly maintained jurisdiction, as a court of the United States, over the case presented by the bill, and for the reasons assigned by the District Judge. Louisville & N. R. Co. v. Rice, 247 U. S. 201, 203, 38 Sup. Ct. 429, 62 L. Ed. 1071; Greene v. Louisville & I. R. Co., 244 U. S. 499, 37 Sup. Ct. 673, 61 L. Ed. 1280, Ann. Cas. 1917E, 88. We also assume, for the purpose of this opinion, that the bill does not show a lack of sufficient interest in the party-complaining, especially as it is filed in the interest not only of plaintiff, but of others similarly situated. Upon the merits, the case lies within narrow compass. It is undisputed that defendant was incorporated under the general Michigan statute of 1867,1 which authorized sucE incorporation “for the purpose of engaging in the business of maritime commerce or navigation within this state, or upon the frontier lakes or other navigable waters, natural or artificial, connected therewith.” This statute was superseded by the general incorporation statute of Michigan of June 18, 19032 which includes corporations “for engaging in maritime commerce or navigation,” and which continued in force all such corporations pre [500] viously organized. Defendant’s articles of incorporation, which constitute its charter, contain no designation or mention of the route or routes over which navigation was intended, nor did either of such incorporation statutes require such designation. Defendant is indisputably a common carrier by water, and as such is engaged in domestic and interstate commerce, and has been so engaged for more than 20 years. Being engaged in the operation of a public utility, it was and is subject to an enforceable obligation (and, we assume, even in the absence of statute or special contract, by franchise or otherwise) to supply on demand reasonable service in the transportation of passengers and freight over such lines as are at the time operated by it. No question of reasonableness of service as to any route under operation by defendant when this suit was instituted is here presented. The sole question before us is whether, either by common law or by statute (federal or state), defendant is forbidden to cease or suspend navigation over a given route over which it has previously operated, because such cessation entails inconvenience or hardship upon the public previously served by. such utility. In our opinion such suspension or discontinuation’ of service upon one or more, or all, of the routes theretofore navigated is not forbidden by the common law under circumstances such as exist here. None of the numerous decisions which assert the power of the courts to prevent suspension or discontinuance by a railway company of its rail lines, in whole or in part, have, so far as we are advised, had any relation to navigation companies.3 So far as decisions denying the right of a railroad company to abandon its lines or tracks may be thought to rest upon common-law principles, unaided by statute, an exception, upon [501] principle, of navigation companies such as defendant may well be found in the absence of contract, express or implied, for operating upon a given route, in connection with the lack of privileges such as eminent domain, as applied either to lines of travel (unnecessary upon the open seas) or to the acquisition of dock and wharf facilities, as well as with the common practice of navigation companies to go out of business altogether, or to change routes and service from time to time, as the interests of the navigation company may dictate. But, whatever may be the reason, the fact that the existence of the common-law power asserted by plaintiff has not heretofore been judicially declared is highly significant. It is not apparent that the situation is at all changed by the fact that defendant, in common with navigation companies generally, is by the Michigan statute (P A. Mich. 1911, No. 70, April 13, 1911) subject to a tonnage tax in lieu of general property taxes — in practice much larger than the tonnage taxes — nor by the fact that defendant has in previous years found the Mackinac line profitable, and that the operation of defendant’s lines, taken as a whole, is profitable. It remains to consider whether the power asserted by plaintiff has been conferred upon the courts by statute. We think it clear that there is no such federal statute. True, by subsection 1 (a) of the Interstate Commerce Act, as amended (Act Feb. 28, 1920, 41 Stat. c. 91, p. 456, as amended by Act June 5, 1920, c. 235, 41 Stat. 946), the act is made applicable to transportation “partly by railroad and partly by water when both are used under a common control, management, or arrangement for a continuous carriage or shipment,” and by subsection 1 (b) to the transportation of commodities generally “partly by rail [502] road or by water,” and by subsection 3 transportation is made to include “vessels,” and by subsection 4 it is made the duty of every common carrier subject to the act, engaged in the transportation of passengers or property, to furnish such transportation upon reasonable request therefor. We agree with the District Court that the addition, under the amendment of 1920, of the words “engaged in the transportation of passengers or property” has not increased or altered the nature or extent of the duty imposed upon the common carriers to which it applied. Not only do we find in these provisions of the Interstate Commerce Act no inhibition upon a carrier by water to suspend or discontinue its route or routes in whole or in part (defendant is not a carrier by rail, except in the sense that it carries by water under joint tariffs, rates, and arrangements with rail carriers), but any implication of such inhibition is to our minds plainly repelled by subsection 18 of the amended act, which provides that— “No carrier by railroad subject to this act shall abandon all or any portion, of a line of railroad, or the operation thereof, unless and until there shall first have been obtained from the commission a certificate that the present or future public convenience and necessity permit of such abandonment.” This inhibition, directed alone to the “carrier by railroad,” indicates, we think, a legislative intent to exclude from its effect carriers by water. We have no doubt the Interstate Commerce Commission rightly disclaimed jurisdiction to act in the premises upon plaintiff’s request. We think it equally clear that no Michigan statute confers’, upon the courts any authority to restrain the suspension or discontinuance of service over the route in question. The statute of 1919 (P. A. Mich. 1919, No. 56, April 10, 1919) forbids a common carrier by railroad to “abandon its main line of track, or tracks, or any portion thereof, or remove or close any of its main line track, or tracks, except for the purpose of repairing the same or altering the line of the track, except by permission of the Michigan Railroad Commission in accordance with the provisions hereof.” Section 1. It is significant that this statute contains no mention whatever of common carriers by water, and discloses, we think, an express legislative intent not to include them.4 Since the instant suit was brought the Legislature of Michigan has passed an act “to regulate the service, rates, fares and charges of carriers by water within this state” (P. A. Mich. 1921, No. 246, May 18, 1921) which act provides for investigation by the state Public Utilities Commission5 of any complaint “against any rate, fare, charge, or tar [503] iff of auy carrier by water within this state, or against any rule, regula-, tion or service of such carrier, or against the neglect, failure, or refusal of any such carrier to *. * * observe or perform any rate * * * rule * * * or service,” with authority to regulate the performance or observance of such "rate, fare, charge, or tariff, and any rule, regulation, or service,” with power to “prescribe the same to be observed by such carrier.” Section 4. It is matter^ of public information that the Michigan Public Utilities Commission has held that it has jurisdiction over some features, at least, of applications to compel resumption of service on the line in question. It scarcely need be said that the existence of such power in the commission confers no authority upon the courts to furnish the relief asked by the bill in this cause. The order of the District Court, dismissing the bill of complaint, is affirmed. Footnotes [2] P. A. Mich. 1903, Act No. 232, § 1; Comp. Laws Mich. 1915, c. 175, § 9017. [3] Prominent among the eases relied on by plaintiff or interveners are: Central Transportation Co. v. Pullman’s Car Co., 139 U. S. 24, 11 Sup. Ct. 478, 35 L. Ed. 55, where it was held that a lease by the plaintiff (which was chartered for “the transportation of passengers in railroad cars constructed and to be owned by the said company”) of all its cars to defendant for 99 years, with agreement not to engage in the business of manufacturing, using, or hiring cars during the life of the contract, was ultra vires, the court saying (139 U. S. 50, 51, 11 Sup. Ct. 485. 35 L. Ed. 55). that “the plaintiff exercised a public employment, and was charged with the duty of accommodating the public in the line of that employment, exactly corresponding to the duty which a railroad corporation or a steamboat company, as a carrier of passengers, owes to the public, independently of possessing any right of eminent domain.” (Plainly, this decision is not opposed to the conclusion we have announced above.) Interstate Commerce Commission v. Transit Co., 224 U. S. 194, 82 Sup. Ct. 436, 56 L. Ed. 729, where it was held that carriers partly by railroad and partly by water, under a common arrangement for a continuous carriage, are within the Interstate Commerce Act, and so subject to the provisions of the act authorizing the commission to require a system of accounting. (Neither this nor either of the1 following decisions cited in this note throw light upon the Common-law rule.) Chesapeake & Ohio Railway Co. v. Public Service Commission, 242 U. S. 603, 37 Sup. Ct. 234, 61 L. Ed. 520, where it was held, following the Supreme Court of Appeals of West Virginia, that a law of that state which declared that “railroads” shall be public highways, “free to all persons for the transportation of their persons and property,” embraces a branch line constructed and operated under it, and imposes on the carrier with respect to such line a continuing franchise obligation to transport passengers as well as freight, and that such obligation may be -enforced by state action, although the carrier has long operated the branch [501] in freight traffic only and never in any other. Grand Trunk R. Co. v. Michigan Ry. Commission, 231 U. S. 457, 34 Sup. Ct. 152, 58 L. Ed. 310, where an order of the state commission requiring certain railroads doing an interstate busi•ness to use their tracks within the limits of a city for the interchange of intrastate traffic was sustained as being within the regulating power of the commission, the court remarking (231 U. S. 473, 34 Sup. Ct. 158, 15 L. Ed. 310) that to certain controlling conditions previously mentioned there must be added “the fact that the railroa'd itself for a long period of time had recognized the situation and had applied the tracks to uses of transportation in the proper sense, as distinguished from mere terminal service, a use which was only abandoned or sought to be abandoned when authority was exerted to prevent unreasonable and to secure reasonable charges for the services.” Terminal Taxicab Co. v. District of Columbia, 241 U. S. 252, 36 Sup. Ct. 583, 60 L. Ed. 984, 4 Ann. Cas. 1916D, 765, where it was held that in determining whether a corporation is or is not a common carrier the important thing is what it actually does, and not what its charter says it may do. Gasser v. Garden Bay R. Co., 205 Mich. 5, 171 N. W. 791, where it was held that a railway company, having been incorporated under the laws of the state as a common carrier, and having secured permission from the Eailroad Commission to issue stock, and having entered upon the operation of its line under an implied duty to the public to continue its operation as a public service corporation, could not thereafter arbitrarily abandon operations permanently, discontinue the assumed service, and dismantle the road, without the consent of the state through its constituted authority. The syllabus in Hocking Valley R. Co. v. Public Utilities Commission of Ohio, 92 Ohio St. 9, 110 N. E. 521, L. R. A. 1918A, 267, Ann. Cas. 1917B, 1154, which represents the decision of that court, contains nothing specially pertinent to the proposition we are considering. [4] in view of this situation there is little, if any, significance in the fact that by the earlier statute creating the Michigan Railroad Commission (P. A. Mich. 1909, Act 300; 2 C. L. Mich. 1915, c. 155, § 8109 et seq.), the term “common carrier” is made to include those engaged in “the transportation of passengers and property wholly by rail or partly by rail and partly by water” ; that the term “transportation” includes “all instrumentalities and facilities of shipment” (section 8111); and that every common carrier is required to furnish “reasonably adequate service and facilities” and to “provide and furnish transportation of passengers and property upon reasonable requests therefor” (section 8112). [5] The Michigan Public Utilities Commission was created by Act No. 419, May 15, 1919, and thus subsequent to the act before referred to, relating to the [503] abandonment by a common carrier by railroad of any of its tracks except by permission of the Michigan Railroad Commission. The latter commission was abolished by the act creating the Michigan Public Utilities Commission.